Major economic crises tend to be followed by crises in subjective well-being. Following the financial and debt crises, politicians and social scientists have engaged in heated discussions of ways to alleviate such losses. In particular, should governments intervene more or less? This paper explores whether liberalizing economic institutions, a type of reform favoured by some economists, is likely to alleviate such loses. Estimating the effects of crises across European states 1975–2011 suggest that countries with relatively easy market regulations suffered smaller well-being losses.